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Wong MNC Center Highlighted Publications

This Opinion piece, published in the July 13, 2017 edition of the Wall Street Journal, considers the merits of the US Donald Trump administration reported plan to impose 232 sanctions on steel imports. It provides background on the United States's historical use of steel tariffs, discusses some of their limitations and merits, and offers some alternatives to address some of the underlying concerns fueling the imposition of steel tariffs.

Multinational corporations (MNCs) are dominant actors in the global economy and play an extremely prominent role in world exports through intrafirm trade. Given this, the workability of the arm’s length standard (ALS) is a critically important issue for global tax justice. The ALS is the core norm that underlies the pricing of transactions within MNCs for purposes of determining corporate income tax payments in the home and host countries where the MNC operates.

More so than any other developing country, China has benefited profoundly from foreign direct investment (FDI), using it as rocket fuel to launch the country’s economic development. But it would be a mistake to interpret China’s willingness to accept strategic FDI as an indication of any great level of comfort with the notion of an enduring, conspicuous presence of FDI providers. Quite the contrary: FDI has been seen as an uncomfortable but necessary trade-off, required to bridge a developmental chasm.

In the past year, the Chinese government has eased restrictions on Chinese companies investing overseas. Italy has become a significant target for investment by large Chinese state owned companies (SOEs), particularly those directly administered by the central government (central SOEs). Under Chinese law, SOEs are subject to special regulatory regime. What does this mean for Italian companies that are targeted for acquisition, before and afterwards?

Whether outward foreign direct investment (FDI) projects boost or shrink domestic employment of multinational enterprises (MNEs) in home countries has long been a subject of debate. This study explores this argument with a sample of 604 Japanese MNEs that had established 2,345 foreign affiliates operating in 22 industries (including both manufacturing and service sectors) across 58 countries from 1991 to 2010.

Inward direct investment benefitting the Japanese economy is extremely low in comparison with other countries. High business costs stemming from high tax rates, stiff regulations, and personnel shortages are among the factors inhibiting inward direct investment. The government must vigorously push forward with deregulation and corporate governance reform to expand inward direct investment

This latest edition of China Analysis, “Your investment, our economy”, edited by François Godement, focuses on some of recent aspects of China’s economic reforms. It addresses three key questions about China’s economy: Is President Xi Jinping’s hold over China’s one party state helping or hindering economic reforms? Have China’s economic achievements of the past made life for foreign investors much more difficult by tilting the economic playing field in favour of domestic companies? How vulnerable is the Chinese economy to a collapse caused by increasing domestic debt coinciding with a sudden economic slowdown.

This is a summary of the outcomes at the 25th U.S.-China Joint Commission on Commerce and Trade (held in Chicago, US) which was co-chaired by US Secretary of Commerce Penny Pritzker and US Trade Representative Michael Froman and Chinese Vice-Premier Wang Yang. For investors in China, there were noteworthy outcomes relating to technology localization, the protection of trade secrets, and competition law.